Tips for Financial Success Submitted by Teri Treadway, Cornerstone Mortgage 832-379-0600 / www.TeriTreadway.com 1) Establish a financial plan In order to achieve financial success and secure your financial future, it’s essential to establish clear goals and objectives, and take the necessary steps to attain them. This begins with designing a financial plan to help you live within your means and identify your financial objectives. Your financial plan should include a current budget and future goals. Understanding how your income is being used for expenses can help you identify any challenges that may impede your long and short term financial goals. Organize, prioritize and put your goals in writing. 2) Determine your net worth Your net worth is the total value of your assets minus your liabilities. To determine your net worth, begin by adding the approximate value of all your assets. Examples of your assets include items like your home, car(s), checking and savings accounts, and the current value of investments such as stocks, real estate, retirement accounts and IRAs. Next, add the approximate value of all your liabilities. Liabilities may include the remaining mortgage on your home, car loan(s), student loan(s), credit card debt, income taxes and any other outstanding bills. Subtract your liabilities from your assets. This will determine if you have a positive or a negative net worth. The goal is to produce a positive net worth and to build upon it. Review and update your net worth annually. 3) Allocate savings To allocate savings, you need to pay yourself first. This means establishing a set amount to save each pay period instead of spending it on current expenses. Develop the habit of saving ten percent of your paycheck before paying bills. If possible, have this money direct deposited into your savings account. The compound interest of saving a few dollars each month is an easy way to contribute to your financial independence. 4) Create an emergency fund Since no one is protected from life’s contingencies, it is essential to have an emergency fund to maintain financial security and avoid incurring debt. Emergency funds give you something to fall back on should you or someone in your family become ill or disabled, or if you or your spouse loses a job. The minimum amount in your emergency fund should be three to six months of fixed living expenses in an easily accessible account. 5) Execute the plan The implementation of your financial plan is essential to its success. Set a date to implement your plan and create a schedule to pay bills and review the monthly financial statements. To ensure long-term success, regularly evaluate your financial plan and establish specific dates to review its progress. Keep in mind that your financial goals will change, and as they do, apply these modifications to your financial plan. I understand that financial planning is a life-long process and that is why I can help you choose a mortgage loan that complements your overall financial objectives. Please contact me, Teri Treadway, at 832-379-0600 or ttreadway@houseloan.com for a mortgage consultation. I look forward to hearing from you.